Prior to the launch of Radeon X800 ATI held an "ATI Technology Days" seminar for press over in Toronto. Whilst there we had the opportunity to talk with the man in charge of steering ATI's operations at the moment. We had a short time to sit down with Dave Orton and quiz him about the directions ATI is taking and to look at their engineering operations for the PC graphics side of ATI's business.
Hi Dave. I guess the first thing is congratulations are in order (it was recently announced that as of June '04 Dave will relinquish his role of COO and move to the CEO position within ATI, with KY Ho, the current CEO, moving on to Chairman of the board).
Oh, I guess – some people think condolences are in order!
No, what’s interesting is that we’ve operated the company this way for some time anyway, so it was really a case of aligning the titles with the jobs and there are no organisational structural changes in the company. It was a nice gesture by KY and the board, so I appreciate it.
Now that you’re fully heading up the company are there going to be any significant focus changes for ATI or is it still a case of “stay the course” for the moment?
No, its stay the course as it is.
I think what KY found was that he wasn’t really doing anything operationally within the company and he’s been spending a lot of time talking to partners and trying to develop a lot of our strategic relationships as we look our handheld business and DTV in Korea and Japan, and then continuing to work the relationships with the foundries, and TSMC in particular, our key partner there. This is more representative of the role of Chairman anyhow and he doesn’t really deal with the financial community at all, which has really been one of the roles of the CEO with the CFO, so we’ve just realigned internally.
One of the things we’re here at the ATI Technology Seminar event for is to learn about your latest high-end desktop part (Radeon X800), but this part of ATI's business appears to be becoming an increasingly smaller string to ATI’s bow, isn’t it?
Well, it is and it isn’t.
To date, still about 70% of our revenue is discrete PC standalone business, and 70% is a big number! And if you look at NVIDIA's revenues its even higher as they don’t have the notebook business that we do to go along with that – our notebook business is running about 35% of our total business and 40% of our PC business every quarter, and a third of that is integrated. So the discrete business is still extremely important, but you’re right, when you look at the horizon there’s a lot of other business out there.
I've been very frustrated with the HDTV business for a couple of years here, when you look from the standpoint of our investment verses the market. When you look at where the market is today and you then think about winding the clock on two years from today where every TV in North America is going to ship HD ready and today there is only 3 Million sets, which could grow to over 30 Million sets in this period representing a 10X growth in two years. You have to think that ATI’s potential in that market is fantastic. In the short-term the wins we’ve had recently with handhelds and the growth of that platform is great.
So we’re excited about these new markets but I think we’re set up well as a company to not defocus from one and defragment and destroy the other.